A gentle reminder: CST power plants with 10+ hours of built in storage are available now

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A Renewable Energy Target which rewards all generated MWhs equally has driven the successful uptake of the cheapest technologies for creating MWhs – what a surprise! Building large LNG export plants connected to the East Coast gas system has pulled gas prices up to world parity – what a surprise! Our oldest and most polluting coal plants are being retired by their owners at a time when they are reaching the end of their economic life and the world is looking to limit GHG emissions – another surprise?

So we are being told that maybe the sky is falling; we need new baseload capacity, we need more synchronous generators, we need more gas, we need energy storage, we need more market participants in SA, we need more coal plants, we need to wind back the clock….

In fact, there is substance to many of the points that are being raised, but they come bundled with in many cases a lack of technical understanding and a bunch of hidden and not so hidden agendas.

Let me hypothesise that what we as an Australian society actually ‘need’ from the electricity sector could best be described as: ‘the provision of all the services best provided by electricity in a least cost and resilient manner with GHG emissions and other negative impacts transitioning to zero over the next 3 decades’.

As the title suggests, this article is intended to remind people that Concentrating Solar Thermal (CST) is a mature and available technology that possesses precisely the attributes that people are arguing need to be added or retained in our electricity system as we increasingly remove fossil fired generation.

CST power generation in all commercial plants uses steam turbines connected to synchronous generators. These are the same as encountered in fossil fired power stations, however customised for solar operation to give faster start-ups.

They can provide, as a matter of course, all the ancillary services (ie the various aspects of frequency control and network stability) that are currently provided in the NEM largely by fossil fired generators and about which there has been so much recent controversy.

The CST industry has now adopted as a standard, integrated energy storage using tanks of hot liquid salts. Plants are typically built to provide between 5 and 15 hours of full load operation in a flexible / dispatchable manner.

The cost of CST energy has dropped considerably just as it has with wind and PV although the data is harder to obtain and analyse. The International Energy Agency suggest that the cost of energy from CST with storage will drop below USD100/MWh by about 2025[1] . In 2012 ITP produced a detailed report for the then Australian Solar Institute – a precursor to ARENA on the potential for CST in Australia.

In that study we estimated that an LCOE for a mature system in 2012 would be $250/ MWh[2][i], in 2015 we completed analysis for Abengoa extrapolating from their detailed bottom up cost analysis of a first 30MW  Tower plus salt plant for Perenjori WA, to a value for a mature 100MW system, of $170MWh.

In the course of 2016, industry indications are that $150/MWh would be achievable. As with every new technology costs drop with deployment and CST will get considerably lower than that in the long run. These are major cost reductions and as with the other renewables, some published technology cots comparisons continue to report old data in a way that can falsely influence policy makers.

CST systems are most cost effectively built in the range of 50 – 250MW. Renewable energy power stations in the range 50 – 250 MW were once viewed as intimidatingly large, but now that we are contemplating retirements like Hazelwood at 1,600MW, they should rather be viewed through a 2017 lens as small and modular.

CST plants have been operating continuously in California for over 30 years. Global deployment has had an average compound growth of over 30%/year for the last decade. Current total deployment of 4.5GW of generating capacity means it is still in its infancy, but it is way beyond being experimental. In fact that level of accumulated deployment is about where PV was in 2005 or wind in 1995.

Integrated thermal energy storage actually lowers the cost of the generated energy from CST plants. It does this because it removes the need to shed midday excess solar input and so increases annual output from a given solar field size. It also allows the power block to run for a greater period of time and thus be amortised more efficiently. These two factors outweigh the extra (cost effective) investment in the storage subsystem.

Australia has on average the world’s best solar resources and these are greatest inland from the coast. Consequently the best locations to build CST plants are in a distributed fashion around the inland extremities of the electricity transmission and distribution networks.

This brings a number of other positive consequences. CST with storage would help to support the operation of networks and make them more resilient to interruptions such as those experienced in South Australia last September. CST with storage can avoid major investment in network extensions. CST generates a great deal of regional employment during construction (noting that more of the value lies in construction that in the factory manufacture of components).

So far Australia has not constructed a utility scale CST plant. Consequently the technology appears out of sight out of mind in this country.

Spain re-ignited the global CST industry in 2005 and lead global deployment growth until a change of government lead to a policy reversal in 2010.  In that time they drove deployment growth of over 2,300GW[3]. Once supply chains are developed in a country, plants can be built in 18 months from ground breaking to grid connection.

At $150/MWh CST can not compete with wind and PV under the current RET. But PV and Wind are variable and CST comes with 5 – 15 hours of storage built in for the price. It would be operated to naturally target the late afternoon early evening high wholesale price periods.

At $150/MWh it starts to look to be on par with hypothetical new build gas generation under future gas prices, but with zero emissions. It also looks more attractive than new build Ultra Super Critical coal plants (but with zero emissions). It is certainly vastly cheaper than a nuclear solution.

Australia could start down the CST track with a competitive international procurement process for the first few plants say 200MW in total from 2 or 3 plants from experienced players.

This could be via initiatives from a combination of the Australian Renewable Energy Agency (ARENA), the Clean Energy Finance Corporation (CEFC) and state based procurements. If we maintained a 30% per year growth rate from such a starting point (consistent with Spanish experience), over 10GW could be achieved by the early 2030’s, providing a good balance to our Wind and PV systems.

But that is just my opinion and maybe I am biased. I suggest the most important thing right now is to also begin immediately to adopt policy and market settings that are technology neutral but fairly reward all the features that we identify we need for a resilient electricity system that also transitions to zero emissions.

There is a good case that the RET should be left unchanged to give certainty to current investors until 2020. Beyond that a new structure is needed, with continued increase in share of Renewable Energy but with certificates earned in proportion to generation multiplied by a scale factor based on a normalised wholesale spot price at the time of generation.

This could be approximated by fixed time of day scale factors for simplicity if needed. Such scale factors should also be employed in state based procurements.  Further, we should consider a new market mechanism for zero emissions ancillary services (ie the various aspects of frequency control, network stability and system restart capability) that are currently provided in the NEM largely by fossil fired generators.

If our market and policy settings were adjusted in such a manner, then let the most profitable technologies thrive. I think CST will be one of them, but if other technologies prevail then it would be for the right reasons rather that due to other agendas.

[1] IEA 2014, Technology Roadmap, Solar Thermal Electricity.

[2] ITP, 2012, Realising the Potential for Concentrating Solar Power in Australia, for The Australian Solar Institute.


Keith Lovegrove is head of Solar Thermal, ITP Energised Group  

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  • 小杜 (xiao du)

    Its generally called CSP (Concentrated Solar Power), rather than CST, although that might be a .au naming weirdness.

    We have a few small CSP plants in SA (South Africa), although they’re quite small. Our solar irradiance values are also best in the world (a claim most sunny countries make?)

    2016 pricing for the Noor1 160MW CSP plant in Morocco/Western Sahara came in at around $6/watt. (US$0.18 /KWhr). Still plenty of room to fall, but pure Solar PV is already roughly a third that price, and still falling.

    CSP is still quite expensive in comparison to Solar PV, _even_ if you cater in storage + PV for an apples-apples comparison. eg Solar + PV storage in Hawaii recently hit $0.11/KWhr. CSP needs to fall quite substantially if it needs to stay in the game.
    CSP still makes (bare) financial sense in larger storage installations – eg GW range, but PV+Storage pricing is dropping faster than CSP pricing is dropping, so this is only a short term win for CSP.

    Other issues – one of the larger CSP vendors – Abengoa is bankrupt.
    Whether this scuppers the entire industry is yet to be seen.

    Good overview of projects in play here – http:// analysis newenergyupdate com/csp-today

    • Gary Rowbottom

      There are some additional benefits with CST that you won’t get with batteries as far as I know. You’re right, it seems to be called CST in Oz, CSP most everywhere else, I guess Concentrating Solar Thermal vs Concentrating Solar Power. Potato potato, though I prefer CST as the thermal is a hint it is a thermal process. You do need to factor in appropriate costs for PV and batteries on the basis of same number of delivered MWh from storage. There have been some big (gish) commitments to CST fairly recently, eg 10,000 MW capacity by China. As Keith Lovegrove has indicated Solarpaces is a good place to see the status of deployment. I’m hoping we see Port Augusta appear on there soon. The CSP today is a good resource too. Redstone CSP in Sth Africa was meant to have started construction (100 MW, 12 hrs storage) by now but has been held up for some reason.

      • 小杜 (xiao du)

        The PPA for Redstone hasn’t been signed by Eskom.
        Eskom is being rather reticent about signing for the REIPP4 and 4.5 approved projects.

        Eskom has been underfunding transmission network upgrades in order to have an excuse for this. The issue is really that Zuma (and his gang of ANC thieves) wants Nuclear, as there is money, money, money to be thieved away in corruption. The ANC just did that quite openly for the Medupi Coal power station in conjunction with Hitachi. Hitachi got smacked for that oversea’s by the American Foreign Corrupt Practices Act.

        Some details here on the CSP side of things – http://analysis newenergyupdate com/csp-today/markets/south-africas-csp-future-rests-grid-policy-solutions

        CSP vs Solar + Storage pricing – I’ve already said CSP is worth it for larger scale (eg GW sizing ie 100MW x 12 = 1.2GW ), for smaller sizing though eg 200MW or lower, its being beaten.
        Potato Potato though 🙂

    • Jonathan Prendergast

      Thanks for this contribution. Very diplomatic also.

      CSP is very appealing, and many of us would love to see CSP come down the cost curve like Solar PV and Wind have, but it seems the experience and evidence is not as positive, and we may never see the day that CSP becomes a major player in our electricity generation mix.

    • Rohan Bussell

      The model so far for PV solar kinda demonstrates the folly of government policy makers rushing into renewables. If the world had its time over, would they repeat history or would they take a calmer and more measured approach and target the commercialization of solar thermal instead of intermittent solar pv. The capacity factor for solar pv (DAT) in the 2017 AEMO report is a maximum of 32%; its hard to get excited about that tbh.

  • Chris Baker

    Your suggestion of a scale factor for LGCs based on time of day generation is interesting. I’d like to expand on that idea and suggest the scale factor be based on whether the energy is dispatchable or not. Suppose we allow a factor of 3x for dispatchable renewable energy — that is, 3 LGCs for every MWh of dispatchable renewable energy. This would encourage any type of renewable energy generator, solar, wind, CPS, wave and so on, to consider building energy storage integrated with the generator. A generator with such storage would also enjoy the higher spot prices that comes with being able to choose time of generation.
    As with your time of day scheme, this would introduce a mismatch at the retail end where the number of LGCs would not match the available MWh of RE electricity available. So there would also need to be matching factor to properly match the number of LGCs needed to represent 1 MWh of power. This factor would gradually climb from 1.0 as more despatchable generation entered the market.

    • Mike A

      Might encourage broadly but the huge cost of energy storage per MWh makes it unlikely. There are today two quite different bands of costs energy vs energy and storage. The 17 cents kWh referred to here was the rate until maybe Hawaii

  • Eb

    Timely article, would be good to get an update from the Clean Energy Innovation Fund on how they are progressing on their ‘priority number one’ of facilitating a CSP plant near Port Augusta.

  • danielspencer

    Great article cc Malcolm Turnbull

  • Gary Rowbottom

    Support from SA Government (as long term power buyer at fixed price) augmented by some combination of AENA/CEFC/CEIF support could see this “Highest priority” utility CST plant with large scale storage, become reality. Instead of laughing and making jokes about SA in the nations parliament like they did today, there’s a chance to “get results” if our nation’s leaders can stop using energy as a political bludgeon for long enough.

    • Rohan Bussell

      “Instead of laughing and making jokes about SA in the nations parliament like they did today”
      Easy to do when the state government is so obviously incompetent. Weatherills government makes it seem like noone could have ever known or foreseen that things would work out this way.
      SA is now committed to a government operated backup gas power station…presumably this will be open cycle….theres a big difference between 0Kg/MWh and 600kg/MWh…even if they only operated this at 10% capacity factor; through all of this we’re still expected to believe that calamitous climate change is imminent.
      If we dared to look, we would also be scratching our heads and the huge coal power plant build taking place across Asia and wonder what was in the koolaid we all drank 10 years ago.

      It pays to have a modicum of skepticism in this area.

  • ChrisB_SA

    Heading talks about plants with 10 plus hours storage but no where did the article quote examples of the rate or total MWh that could be dispatched over those 10 hours after the sun goes down – have to dig through the referenced documents one of which only said 5 hours. Still, a large enough unit might still be able to soften the evening peak after PV panels switch off due to insufficient photons.

  • Tim Buckley

    Keith excellent update, really helpful. It will be interesting to see if China proceeds with CSP now it needs more peaking capacity. China has been adding a lot of pumped hydro storage, and now leads the world. The central government has referenced a plan for more CSP and that would certainly drive the economies of scale and learning by doing, taking the delivered cost of peaking CSP electricity down dramatically over the next 5 years or so. Cheers Tim ps typo on the sentence attached to reference 3 – its 2,300MW in Spain (not GW).

  • Joshua Carr

    Forgive me keith but shouldn’t local government already:
    “adopt policy and market settings that are technology neutral”?

    With the RET in mind, it can’t be that hard to figure out whether a 70MW CSP trial plant in SA is a good idea. I hope whatever the decision is, all factors are fairly considered.